Of Rural Connectivity and Digital Inclusion in Africa

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Accelerating mobile access for a digitally inclusive society is imperative for connecting millions of underserved communities in Africa, writes Emma Okonji

Despite the large population of African countries, mobile connectivity that is expected to drive digital inclusion is still low among rural dwellers. The 2016 Mobile Economy report for Africa, which was released by GSMA during the GSMA Mobile 360 Africa event in Dar Es Salaam, Tanzania last week, showed that at the end of 2015, 46 per cent of the population in Africa, subscribed to mobile services, which is equivalent to more than half of a billion people. Africa’s three dominant markets- Nigeria, Egypt and South Africa, together accounted for about a third of the region’s total subscriber base.

The report, however, explained that subscriber growth rates are now beginning to slow, occasioned by affordability challenges in mobile devices and broadband connectivity.
In the light of this development, GSMA is of the view that migrating to mobile broadband is the key to accelerating access for a digitally inclusive society for Africa.

Mobile broadband
Subscribers across Africa are beginning to see the need to migrate to mobile broadband services, driven by network rollouts and mobile operator device and data strategies. According to GSMA 2016 Mobile Economy report for Africa, mobile broadband connections accounted for a quarter of a total connections at the end of 2015, but would rise to almost two-thirds by 2020. The report said that by mid-2016, there were 72 live Long Term Evolution (LTE) networks in 32 African countries, half of which had launched in the last two years.

The launch of new mobile broadband networks across the African region coincides with the growing availability of low-cost devices. The number of smartphone connections has almost doubled over the last two years to reach 226 million, accounting for a quarter of total connections in the region.
“This reflects strong uptake in the established mobile markets in Nigeria, Kenya, Egypt and South Africa, as well as some relatively new 3G markets in Algeria, Cameroon and Democratic Republic of Congo. Over the next five years, the region is expected to add a further half a billion smartphone connections, taking the adoption rate to more than half of total connections,” the report said.

Mobile money

In order to drive digital inclusion through mobile connectivity in Africa, the GSMA forum called for affordable technology that would boost mobile money in Africa.
The forum said a reduction in the cost international remittances would boost the growth of mobile money in Africa, and it would create opportunity to bring in more people into the financial inclusion and also boost regional trade in Africa.

The forum, however, identified some challenges of mobile money in Africa to include harsh government policies, poor infrastructure, and regional regulatory challenges. It is becoming extremely difficult to carry out international money remittance because of issues of policy compliance across borders. Over $54 billion is transferred globally in one year using mobile money and Africa accounts for only $12 billon of the amount, the forum said, adding that the cost of remitting money across African countries is about 30 per cent of the volume of money transferred, because of high interest rates for regional money transfers.

The GSMA forum suggested that transfer cost should be reduced from the present 30 per cent to five over cent, to enable more people involve in mobile money in Africa, and to boost digital inclusion in Africa.
The forum argued that access to financial services is a fundamental right, and that mobile money remittance is the only accessible way of transferring and receiving money among other channels, and called on regional regulators to have complete understanding of how mobile money operates.

Women and mobile money transfer

It has been established that 225 million women in Africa do not have mobile money account. Mobile money transfer among African women is growing but the gap between men and women involvement in mobile money transfer is huge as there are more men involved in mobile money transfers than women. The situation will continue to frustrate the efforts and vision for digital inclusion in Africa, as currently being canvassed by GSMA, if urgent steps are not taken to address the issue.
There is therefore the need for mobile money operators across African countries to target young women in rural communities to get actively involved in mobile money transfers.

A recent study by GSMA carried out in Kenya and Rwanda, and some other African countries, shows that women have less access to money and they are reluctant to do mobile money transfer because of high cost of remitting money through mobile money platform.
African Women have less trust for mobile money than the men and
African women prefer to save money in banks and use bank services for financial remittance, instead of using mobile money channel, the study said.

Innovation fund
To further drive digital inclusion in Africa, through mobile connectivity, the GSMA has launched innovation fund that would be used to boost digital inclusion for Africa.
The GSMA Ecosystem Accelerator Innovation Fund, which was launched during the GSMA M360 Africa Series in Tanzania last week, would support innovative start-ups in emerging markets and is open to start-ups from and operating in Africa and selected countries in Asia. The Fund is backed by the UK Department for International Development (DFID) and supported by the GSMA and its members.
Director General of the GSMA, Mats Granryd, said: “Through our Mobile for Development team, the GSMA has a proven track record in delivering life-enhancing mobile solutions at scale in critical areas such as mobile money, health and nutrition, agriculture, utilities and many others.”

According to him, “the launch of the Ecosystem Accelerator Innovation Fund is an exciting opportunity for the mobile industry to work with entrepreneurs in developing markets to create services that will deliver important socio-economic benefits to their communities. I anticipate that we will see some incredible applications and I look forward to seeing the first selected start-up businesses flourish.”

The Fund will help identify innovations with the greatest potential for growth and provide best practices for stakeholders within the ecosystem on the ways in which they can use mobile to drive positive socio-economic impact. The Fund will provide funding and mobile-focused mentoring and technical assistance to selected start-ups, and establish partnerships between operators and start-ups to increase the reach of innovative mobile services.

The Fund will also run several rounds between 2016 and 2020, with each round having specific areas of focus. During the first funding round, which will disburse approximately £2 million, applicants are expected to align solutions that will define as any mobile-based platform, product or service which enables low-income citizens in emerging markets to generate income from ‘under-utilised assets, such as free personal time or vehicle use, by sharing those assets with their peers. Their solutions are also expected to support Small and Medium Enterprises (SMEs) in emerging markets that will unlock improved productivity and growth.

Unrealistic UN 2020 goal

The Alliance for Affordable Internet (A4AI) has expressed strong doubts over the United Nations’ (UN) objective to provide universal affordable access to the internet by 2020, especially for African countries, suggesting it could take decades to reach this goal.

Chairperson, Alliance for Affordable Internet, and a former Nigerian Minister of Communications, Mrs. Ombola Johnson, raised the concern, while delivering a keynote paper at the 2016 GSMA M360 Africa event. According to her, more than half of the world’s population could not take advantage of the internet.
Johnson suggested it could take until 2042 for the UN to achieve its goal. “The reality is we have a long way to go,” she stated.

“Key to improving matters is driving down the cost of accessibility. We must set out to work towards 1Gb of data being priced at 2 per cent of monthly household income,” Johnson said, noting that in many African countries such a bundle costs upwards of 5 per cent of income. We need to take action now. We need to seize the opportunity the internet has provided. As the world steams ahead our continent is being left behind. The digital divide threatens to exacerbate existing inequalities among women and the young. These are the areas we need to grow,” Johnson said.
She stressed that connectivity must become a priority at the highest level of government. And different parties should collaborate for wider industry success, while also ensuring that content created for the internet is developed locally.

Based on issues raised about achieving digital inclusion in Africa, it is obvious that there is much work to be done before Africa could close the digital divide. The internet has brought Africa close to the world and there is need for African governments to work closer together to ensure that no African country is left out in the global digital revolution.